5 Best Tech ETFs to Buy in 2025

Introduction

Among the world's well-known large companies, many companies belong to the technology industry, such as Apple, Microsoft, Meta, and so on. These tech companies have delivered rich returns for investors over the past decade.

In the tech industry, though, only some of them deliver long-term returns. Identifying such stocks is a challenging task for us. Therefore, investing in tech ETFs that offer diversification at a relatively low cost may be a better option.

I have many years of experience investing in ETFs, and over the past few years, technology ETFs have been the type I have focused on the most. In this article, I'll tell you how I pick the best tech ETFs.

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Best Tech ETFs

• SPYG - SPDR Portfolio S&P 500 Growth ETF
• VOOG - Vanguard S&P 500 Growth ETF
• IETC - iShares U.S. Tech Independence Focused ETF
• IUSG - iShares Core S&P U.S. Growth ETF
• SCHG - Schwab U.S. Large-Cap Growth ETF

Best tech ETFs must haves

Below are the criteria I follow before investing in an ETF, these are five key points directly from my trading playbook that could assist you in your ETF decision-making.

High-tech exposure

Since we only want to focus on tech-driven ETFs, when analyzing these funds, we want to ensure they have more than 50% exposure to the tech industry. If not, then I dismiss them and focus on other ETFs instead.

Stock position percentage (>90%)

A typical characteristic of a tech ETF is its high stock position. I recommend you consider investing in ETFs with more than 90% equity holdings to ensure that your selected ETF maintains a strong focus on equities (rather than bonds) and earns higher returns.

Yearly price increase (>15%)

Higher annual price growth means strong management behind the ETF. Given the high growth and high returns in the tech sector, I recommend you consider a yearly price increase of at least 15%. For comparison, the S&P 500 index, which includes about 40% of tech stocks, has averaged about 10% annual growth.

Weekly Average Turnover (>$10,000,000)

Because ETFs can be traded freely on exchanges like stocks, they are more liquid than ordinary funds. I recommend investing in ETFs with an average weekly turnover of more than $10 million. These ETFs tend to have relatively good liquidity and can maintain active trading, which is important for stability and ease of access.

Expense Ratio (<0.2%)

The expense ratio is also important in choosing an ETF, especially for cost-conscious investors. The low expense ratio can also improve the long-term return on investment while reducing the cost. So, I suggest you consider ETFs with expense ratios below 0.2%.

Using the above criteria, I used Intellectia's AI screener to sift through a list of the best tech ETFs to invest in. Here are the top 5 best tech ETFs.

1. SPYG - SPDR Portfolio S&P 500 Growth ETF

SPYG is an ETF that tracks the S&P 500 Growth Index. Its low-cost expense ratio is 0.04%.

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To achieve roughly the same return on investment as the index, SPYG's top holding is essentially the same as the index. SPYG's top 10 holdings are the same as the S&P 500 Growth Index: Nvidia (NVDA), Apple (AAPL), Microsoft (MSFT), Meta (META), Amazon (AMZN), Tesla (TSLA), Google (GOOG), Broadcom (AVGO), and Eli Lilly (LLY). And they make up almost as much of the ETF as the index.

SPYG's portfolio is mainly focused on Information Technology (nearly 39%), communication services (nearly 15%), and consumer discretionary (nearly 14%) industries. Benefiting from the AI boom in 2024, most companies in these industries have achieved strong earnings growth. As a result, SPYG's performance in 2024 was very strong, with its net assets and price increasing by 35.97% and 36% yoy (from $64.68 to $87.90).

Outlook for 2025

Thanks to the strong earnings growth of the portfolio companies, SPYG has a P/E ratio of 33.40, which is higher than the average of the S&P 500. However, Intellectia's AI suggests this ETF will face price correction if market sentiment changes.

SPYG remains a good choice for investors seeking growth stocks, especially in technology and AI-driven industries. However, given its high valuation and potential market volatility, a cautious approach is recommended.

2. VOOG - Vanguard S&P 500 Growth ETF

VOOG also uses the S&P 500 Growth Index as its benchmark index. Like SPYG, VOOG's top 10 holdings are the same as the benchmark index, and the holding percentage of each stock in the top 10 is also close to the benchmark index.

Since its inception in 2010, VOOG has had an average annual return of 16.34%. In contrast, SPYG was founded in 2000, but its average annual return was 6.6%. However, VOOG's expense ratio is 0.1%, higher than SPYG, but still lower than the average fee of its peers (0.94%).

VOOG performed very strongly in 2024, with its price rising from $269.36 to $366.06, a year-on-year increase of 36%. Its return rate also achieved the same growth.

If you are looking to invest in large-cap growth stocks in the S&P 500, I think SPYG and VOOG are both good choices. The cost of investing in SPYG is lower, but the return of VOOG is higher. You can choose according to your investment preferences.

Outlook for 2025

Intellectia's AI suggests that with the development of artificial intelligence technology, the technology industry will continue to grow at a higher rate in 2025. This will drive VOOG's price and return rate to further increase.

Intellectia's AI analysis also mentions VOOG's high P/E ratio (34.6) and high exposure to the tech sector (over 50%) as things to watch out for. If the tech sector's earnings growth slows, VOOG's valuation is at risk.

Therefore, if you choose to buy VOOG, I recommend that you monitor the impact of macroeconomic risks on the tech sector and pay attention to the valuation of this ETF. Click here for Intellectia.AI's analysis and outlook report.

3. IETC - iShares U.S. Tech Independence Focused ETF

IETC focuses on technology stocks and technological independence in the United States. Its expense ratio is 0.18%, which is higher than SPYG and VOOG.

Software & Services (36.57%) and Semiconductors & Semiconductor Equipment are the two main investment categories in IETC's investment portfolio. Broadcom has the highest share of 15.39% in the IETC's top ten holdings, and the share of other stocks is less than 10%.

Due to the higher share of the technology industry (more than 60%), IETC's average annual return from inception to 2024 (20.93%) is higher than SPYG (6.59%) and VOOG (16.34%). Among them, the return rate in 2024 reached 37.41%, and its price increased by 38.1% ($61.75 to $85.32)

If you are looking to invest in the semiconductor industry, then IETC will be a good investment choice.

Outlook for 2025

IETC mainly invests in artificial intelligence and technology companies. Considering that artificial intelligence is expected to continue to flourish in 2025, IETC's major holdings, such as Broadcom and Nvidia, should continue to grow. Therefore, Intellectia expects IETC to maintain good performance in 2025.

However, Intellectia warns that focusing on a few high-growth stocks will bring greater volatility risk to IETC. View the full analysis report of Intellectia.

If you plan to invest in IETC, I suggest that you should pay close attention to the impact of the external environment on specific industries, especially the semiconductor industry.

4. IUSG - iShares Core S&P U.S. Growth ETF

The benchmark index tracked by IUSG is the S&P 900. The index comprises the S&P 500 and the S&P MidCap 400 and is used to measure the performance of large and medium-sized market-cap stocks.

IUSG has a large allocation in two industries: information technology and consumer discretionary. Nine of the top 10 holdings are from these two industries. Among them, Nvidia has the largest share, at 12%.

In 2024, IUSG performed well throughout the year as technology stocks led by Nvidia continued to rise. IUSG's annual stock price increase (from $103.37 to $139.35) and investment returns are both close to 35%.

If you don't want to invest only in large-cap stocks, then you can consider buying IUSG. First, it has a good historical performance, with an average annual return of 15% in the past decade. Second, its expense ratio is also low, at only 0.04%. Third, IUSG has a high number of holdings, more than 400, which means it can better diversify risks.

Outlook for 2025

IUSG's low expense ratio (0.04%) and high growth exposure make it an attractive option for long-term investors. Intellectia expects IUSG to achieve sustained growth through 2025, supported by a high-performing industry and strong fundamentals. Check out the whole analysis report of Intellectia.

As of January 2025, IUSG's 12-month analyst price target range is between $155.38 and $156.01, which implies an upside potential of 9-10% over the next year. If you decide to invest in IUSG, I recommend using Intellectia's advanced features to monitor its price in real time and find the right time to buy.

5. SCHG - Schwab U.S. Large-Cap Growth ETF

SCHG is the only ETF that tracks the performance of the Dow Jones U.S. Large-Cap Growth Total Stock Market Index. SCHG has a low expense ratio of 0.04%.

Thanks to its exposure to growing large-cap stocks, mostly technology, SCHG had a strong year in 2024. Its annual price is up 41% (from $20.17 to $28.48) and its annual return is 35%.

Outlook for 2025

If you usually follow the Dow Jones U.S. Large Cap Growth Stock Market Index but don't know which stocks are worth investing in, then I suggest you try buying SCHG.

According to Intellectia's analysis, if the US economy continues to expand, especially in the technology and healthcare sectors, SCHG may rise further in 2025. In a bullish scenario, SCHG may reach more than $30. Click to see Intellectia.AI's analysis and forecast for SCHG.

Conclusion

I have bought the five tech ETFs mentioned above and have received good returns from them. If you are a cost-conscious person, then I suggest you consider investing in SPYG, IUSG, and SCHG. If you are focused on diversification, then IUSG with more than 400 holdings will be a good choice. If you want to invest in more U.S. Tech Independence at the same time, try IETC.

But you also need to be aware that large exposure to the tech sector can also lead to greater volatility in tech ETFs. I would recommend using some AI tools, such as Intellectia, to help you monitor the performance of these ETFs to be best prepared to buy and sell at any time.

Frequently Asked Questions

What is the biggest tech ETF?

According to ETF.com, of the 86 ETFs traded in the U.S. market, tech ETFs have total assets under management of $248.99 billion. Among them, the largest technology ETF is the Vanguard Information Technology ETF VGT, with $68.27 billion in assets.

Which ETF does Warren Buffett recommend?

Buffett believes the best course of action for most people is to own an S&P 500 index fund. Buffett's holding company, Berkshire Hathaway, holds two ETFs, the SPDR S&P 500 ETF Trust (SPY) and the Vanguard S&P 500 ETF (VOO). Both ETFs track the Standard & Poor's 500 index.

Are ETFs the same as stocks?

No. ETFs pool investors' money to buy several individual stocks or other assets. However, ETFs can be traded on exchanges just like stocks, which is the main difference between ETFs and mutual funds.